1.
New Shopper JourneysThe Influence of Digital TouchpointsAlex Charlton Mike Hess Beth UyencoDirector EVP, Research Global Researchessential research Carat N.A. Director Microsoft

2.
Digital media has changed consumer behavior More information More complex decisions More opportunities to influence Greater expectations

3.
How We Did the StudyResearch overview• Qualitative – Interviews and shopper observations across six countries• Quantitative – Online surveys in 17 countries – 19,000 shoppers – Key retail categories: • Apparel • QSR • Grocery • Home Electronics • Home Improvement (US only)

4.
Hierarchy of Shoppers’ New Behaviors • Discount coupons used more often • Price more important than brand/quality • • • • • • • •

5.
Old models no longeradequately describe Awareness Considerationwhat’s happening Purchase

6.
It’s not linear. It’s a dynamic process.Constant Iterations Prior to Purchase

7.
From Paths to Journeys:The New Shopper Paradigm WOM feedback loop Research Need Post State Purchase Purchase In-store research ‘Pre-tailing’ Retailing ‘Post-tailing’

8.
From Paths to Journeys:3 Core Shopping Patterns• Impulse: An unplanned purchase or the shopper did not have enough time to research product or shop around before purchasing• Habitual: An item the shopper normally buys• Research: The shopper did some research prior to buying

9.
From Paths to Journeys:Journeys Vary by Category 17% 37% 43% 20% 66% 60% 28% 40% 63% 22% 34% 35% 17% 12% 6% Home Home Clothes, Shoes, Grocery Fast Food Electronics Improvement Accessories Habitual Impulse Research

10.
Home Electronics

11.
Segmentation is CriticalHome electronic shopper journeys by tech psychographic Cutting Edge Early Adopter Judicious Laggards TimerAll categoryshoppers (%) 19% 23% 32% 25%Q: Thinking about the last time you bought home electronics, which statement best describeyour actions?Impulse 28% 16% 18% 22%Research 49% 64% 69% 63%Habitual 23% 20% 13% 15%Source: Shopper journeys USA 2010 Home Electronics n=1072

12.
Media Receptivity –Touch Points by Segment JudiciousSegment Cutting Edge Early Adopter Laggards Timer% of total 19% 23% 32% 25%Usage IndexAdvertising 145 119 83 68Word of Mouth 100 132 100 71Something seen while shopping 151 99 90 75Newsletter/Email 162 108 97 49TV ads 182 111 65 72Internet ads 150 131 70 70Newspaper ads 144 130 96 43Expert reviews online 108 149 114 30Seeing someone with item 157 156 60 55Past Experience 129 122 78 85Promotion seen while shopping 165 94 96 61Something read/seen online 125 105 113 60Source: Shopper journeys USA 2010 Home Electronics n=1072

13.
Consumer Purchase Path in Home Electronics Research & Pre-Purchase Shopping Around Purchase Post-PurchasePre-determined Source Mobilization Good INFORMATION source online Factors on Final Decision After-FactorsHow much to spend 72% Internet 68% purchaseWhich brand to buy 45% WOM 43% Advice fr. friends/ Retailer websites 42% Customer reviews 36% Price 86% Avail. of product/ BehaviorsWhere to buy 35% family 32% brand 72% Brand websites 35%Model/Specs 33% Something seen while Shopping websites 34% Brands 62% DiscussedProducts 32% shopping 28% Ads & sponsorship 28% Search engines 30% Technical specs 61% purchase with Style/Design/Color 57%Initial friends/familyTouchpoints Good INSPIRATION 36%Ads 32% source onlineSomething seen Discussed retailwhile shopping Customer reviews 28%23% Online shopping sites experience withWOM 22% 23% Price comparison friends/familySomething sites 23% 13%read/seen 22% Retailer websites 23%Speaking to Brand websites 17%friends/family 19% Source: Shopper Journeys USA 2010 Home Electronics n=1072

14.
Post Purchase Fuels Future Journeys:Digital is Enabler Need States Purchase Post-Purchase Advertising: Used mobile Recommended: Online: 17% phone: 54% Brand: 48% TV: 17% Retailer: 30% Newspaper: 24% Compared Magazine: 17% Prices: 30% WoM online Newsletter: 19% Blogged Online: 11% Searched Posted on In-Store for info: 20% Social Network: 11% Flyers: 13% Posted a review: 11% News Story on TV: 11% WoM Expert Reviews Online: 7% From Friends: 15%

15.
Personal Care

16.
Habit as Major Driver in Category PurchasePurchase in personal care is fueled largely by repetition andreplacement: nearly 70% of respondents described their lastpersonal care purchase as regular/habitual replacement 12% Researched before purchase 20% Bought on Impulse 68% Regular replacement/ habitual purchaseQ. Thinking about the last purchase in personal care category, which type of action best describes your purchase?

17.
Openness & Communication asSegmentation CriterionDistribution of factor ‘openness & communication’* &categorization of shoppers into low vs. high receptivity segments LOW HIGH Receptivity Receptivity*Segmentation based on two dimensions:‘When shopping for groceries I often buy and/or try new products & brands’‘I like to talk to my friends/family about the purchases I make in this category’Data Source: Project Red 2010 USA, Personal Care, N=591

18.
Segments SnapshotSegments notably differ from each other on categoryspending, income, shopping behaviors and attitudes PROFILE LOW HIGH Avg. monthly spending on personal care, home care, and groceries $307 $382 % Household Income 70K+ 24% 35% % last purchase was Impulse 14% 28% % last purchase was Habitual 81% 52% % last purchase was Research-driven 6% 20% Opinion Leadership: % agreeMy friends & family often ask me for advice 6% 65% before buying products in this category

19.
Factors on choice of retail store Q. Thinking about where you purchased from, which of the following influenced your decision to purchase there? Total Low High 69.5 69.7 69.4 Price of products 100 100 60.4 56.6 64.7 Proximity of the store 94 107 44.5 43.7 45.5 Familiarity with the store 98 102 43.3 36.6 51.1 Quality of products 84 118 38.0 35.4 41.1 Range of products available 93 108 37.3 34.9 40.0 Positive previous experience at the store 94 107 35.4 28.3 43.6 Deals and promotions at the store 80 123 30.6 27.5 34.2 Discount coupons I had for the store 90 112 17.0 13.8 20.7 Store loyalty card 81 122

20.
Sources – Impulse Buyers 14% of 28% of % last purchase = impulse 20% Total Low High 30.5 26.9 32.6 coupon/money off voucher I receivedcoupon 88 107 25.7 29.0 23.8 newspaper ads 113 93 25.6 18.3 29.7 ads TV ads 72 116 24.5 16.9 29.0 promotion I saw when shopping 69 118 23.7 16.4 27.9 In-store coupons The segment is 69 118 especially moreIn-store sign, display or other information seen 23.6 16.3 27.9 attuned to in- when shopping 69 118 store offers 21.1 18.8 22.4 Speaking to friends, family or colleagues 89 106 14.8 6.6 19.6 magazine ads 44 132 14.1 11.4 15.7 Samples or product demonstrations 81 111 13.2 9.6 15.3 Flyers distributed in store 73 116Q. Thinking about times you have purchased in this category, which of the following inspired you to make a purchase?

21.
Sources – Research BuyersInternet is the most handy tool for research and planning –especially for high receptivity segment 20% of High 58.4 INTERNET 120 35.6 In-store coupons 77 41.1 In-store Store circulars distributed through newspapers 103 31.9 In-store promotions/displays 92 26.6 Adverts in newspaper 81 24.9 Television ads 89 Ads 29.7 WORD OF MOUTH 107 22.8 Advertising I saw in store 101 22.4 Advice from friends, colleagues and family 101 19.6 Flyers distributed in store 94 20.7 Brochures, newsletters or leaflets I received in mail 111Q. Thinking about the last time you bought personal care item, which of the following sources did you use while researching or shopping?

22.
Trigger Touchpoints for New Product Purchase Cost-saving coupons, in-store environment, and WOM are the most frequently mentioned channels for invoking new product trial % bought new or different item 26% of Low 59% of High coupon/money off voucher 115 128 promotion seen while shopping 72 153In-store In-store coupons 111 121 sign, display or other info seen while shopping 72 119 Speaking to friends, family or colleagues 68 153 An advert on television 96 153 past experience or memory 25 135 An advert in newspaper 130 105In-store Flyers distributed in the store 67 127 Brochures, catalogues, newsletters or leaflets 116 105 An advert on the internet 39 172 Store circulars distributed through newspapers 80 127In-store Samples or product demonstrations 110 119 Q. Which sources influenced your decision to purchase an item which is new or different from what you normally buy?

23.
After Purchase Behaviors Total Low High Recommended brand/product to friend/ 27.0 17.7 37.8 colleague/family 66 140 25.6 14.9 37.9 Discussed purchase with friend/colleague/family 58 148 12.2 6.4 18.9 Recommended retailer to friend/colleague/family 53 155 Discussed retail experience with 11.1 3.6 19.9 friend/colleague/family 32 179 2.3 0.6 4.3 Blogged about purchase or retail experience 26 186 3.6 1.1 6.5 Posted customer review online 31 180Q. After you made the purchase did you do any of the following?

24.
Digital is Core to the Research Journey Reach within last Home Apparel Fast Food Groceries Purchase Occasion Electronics USA The Internet The Internet The Internet Discount 65% 50% 43% coupons 51% AMERICAS The Internet Advice from Advice from TV Ads 58% friends 37% friends 45% 38% ASIA The Internet The Internet TV ads TV Ads 61% 49% 52% 57% EUROPE The Internet The Internet Advice from The Internet 64% 43% friends 37% 37%

25.
Digital is Core to the Research Journey:Mobile is Especially InfluentialUS Market: Grocery Shoppers Bought new items Didnt buy any new items 50% 45% 40% 45% 35% 30% 25% 31% 30% 20% 15% 10% 14% 5% 7% 6% 0% Used a cell phone Used Web during research Saw Online ads during research

26.
Conclusions• Need to breakdown the shopping journey into its essential parts to understand the role touchpoints play• Channel planning approaches can build a clear framework for establishing the optimal media mix – Segmentation can drive this process• Learned that Bought Media required to generate Earned Media• The retailer/manufacturer website is still a vital channel• Mobile can influence close-to, or at, point of purchase… offering an alternative to retailer-controlled POP communications

27.
Questions?